Why Are Sterling Exchange Rates So Low? Why Is The Pound Dropping?

Sterling exchange rates have taken another huge hit overnight as the trend of weakness for the pound continued straight at the start of the open on the Asian markets last night. The Pound dipped all the way down to the 1.02s against the Dollar and the 1.07s against Euro as investors and speculators rushed to drop the currency and this caused a great deal of weakness. So why are Sterling exchange rates dropping? Since the announcement of the mini-budget and Kwasi Kwarteng's plans to cut taxes we...

What will 2023 Bring For Sterling Exchange Rates?

Sterling exchange rates have dropped on the whole throughout 2022 and it is fair to say there are a number of quite obvious reasons behind the poor performance of the pound over the course of the year. Here is a summary of GBP paired against a selection of major currencies and the movement since 1st Jan 2022 as an example. GBP/USD -10.79% GBP/EUR -4.97% GBP/CAD -5.44% GBP/AUD -4.69% GBP/CHF -9.97% All in all, the above suggests the pound indeed had a torrid time of it, most notably shortly after Liz Truss...
GBP EUR: Halifax Sees Signs of Housing Slowdown

What to expect from GBP exchange rates in 2023?

Looking back on 2022, GBP exchange rates had one of the most volatile years on record especially against the US Dollar. After such a bumpy ride for the Pound you may expect to see less volatility for GBP exchange rates but with economic growth set to drop this can never be ruled out, especially at the beginning of the year. To recap 2022, GBP/USD experienced its worst annual performance since 2016 which was an exceptional year owing to the unexpected Brexit vote which caught the currency...
GBP EUR Soars Again After UK Employment Boost

How will the Autumn Statement influence the pound?

The Autumn Statement is scheduled for 17th November, and will see Jeremy Hunt, the Chancellor outline fiscal policy for the new Rishi Sunak administration. The pound can be very sensitive to changes in government policy on tax and spending, particularly given the UK's current precarious financial position. We might not expect quite the same fireworks as saw following the last fiscal event in September and early October, with Kwasi Kwarteng and Liz Truss, but that episode highlights the potential volatility we can see from changes...

The Pound loses momentum, could next year bring further falls for GBP exchange rates?

GBP exchange rates have cooled during the month of December, with GBP/EUR and GBP/USD both easing from the 3-month highs they begun the month trading at. There had been a considerable upward momentum for GBP exchange rates after Jeremy Hunt became Chancellor of the Exchequer and reversed the questionable tax cuts made by the previous Chancellor. Rishi Sunak replacing Liz Truss also buoyed the financial markets sentiment towards the UK economy and this helped give the Pound a boost, but perhaps the honeymoon period is...

Pound jumps on expectations that Liz Truss will announce huge economic plan – Sterling...

The pound has struggled to find many positive days in recent weeks, however, over the course of this morning we have seen sterling exchange rates creep up against all major currencies. The majority of this can be put down to a minor shift in sentiment and that investors and speculators alike appear to have some confidence behind the expected economic plans being muted by new Prime Minister Liz Truss. Expectations are for an economic package of £130 Billion to be announced in due course which would...
GBP EUR Higher Despite Dip in Inflation Figures

UK Inflation Rises Once Again ! Will the Pound Rise or Fall on the...

UK Inflation has risen to 11.1%, which is a 41 - year high. The pound is weaker against many currencies on this news, as the damage of rising prices to the economy is considered. Inflation has been a real problem for not just the UK, but also the global economy as central banks are forced to raise and adjust interest rates to combat the rise in prices of goods and services in the respective economies. Sterling might typically be stronger on the back of expectations that...

Will the pound get stronger? Growth figures show a surprise positive reading on Friday

The UK looks set to avoid a recession in 2022 as GDP data was announced on Friday. The UK economy grew by 0.1% in November, with the services sector providing a welcome boost when a 0.2% expansion was announced. This came as a surprise to many forecasters, with a 0.3% GDP contraction the market expectation. Despite this, the pound failed to make any significant gains against the Euro, finishing the week trading at 1.1280 – a near 0.75% decrease since markets opened on Monday. The Pound...
GBP EUR Drops After Bank of England Recession Warnings 

BoE decision looms – where will the pound go next?

The Bank of England are set to announce their latest decision on interest rate policy at midday today. Inflation has become embedded in the UK economy and the bank are tasked at keeping inflation below 2%. The current rate of inflation is over 10%. Interest rate policy is a key tool in managing inflation. A central bank will raise interest rates in an attempt to cool the economy down and bring inflation under control. The bank has raised interest rates at the last 8 meetings. Today...
Pound to Euro Starts the Week off Steady

Will the pound weaken again?

Sterling exchange rates hang in the balance once again following a day of poor performance in yesterdays session. The pound dropped close to monthly lows against euro while also losing value against the US dollar and a basket of other currencies. Sterling has opened this morning on a more positive footing. The announcement that cryptocurrency giant Binance would not rescue their competitor FTX triggered a significant sell-off in the crypto markets. A number of asset funds are invested in the crypto sphere meaning a sell-off...